President Trump continues to threaten tariffs, and the establishment continues to wield fear and loathing. I hope he stays on the course because the nation's long-term future is at stake. Prosperity can extend over the next decade if we stand our ground here. There is no doubt it feels painful, but this will be short-lived. Those with the wherewithal will use this weakness to build a list of names to own. 

I’m more concerned with the stealth labor crisis. I’ve said all along that the problem won’t be mass layoffs but mass attrition. There will be no hiring, shorter hours, and slower pay increases. According to the Atlanta Fed Tracker, wage growth is coming down fast.

Another red flag came courtesy of the Kansas City Fed Manufacturing report.

Tech took it on the chin as Nvidia (NVDA) slumped. The Technology (XLK) Sector failed to hold its 200-day moving average. It's incredibly oversold, but the dust has to settle.

Once again, low volume was the only place to hide.

Today’s Session

Consumers are pulling back and saving money.  They are not blindly going to pay extra for anything that is not essential.  

• Personal income increased $221.9 billion +0.9%

• Personal consumption expenditures (PCE) decreased $30.7 billion -0.2%

• Personal saving was $1.01 trillion in January and the personal saving rate - personal saving as a percentage of disposable personal income - was 4.6 percent.

 

The Market

Unprofitable tech is seen as a proxy for irrational exuberance.

The fear campaign not only makes stocks cheaper for big buyers, but it rewards those that have been short.  That group has taken it on the chin for some time and are banking recent profits.

Now, profitable tech has sold off as well – but simply being oversold is not the same as a buy signal.

That will come soon, I want to be positioned for a snapback, but not on a Friday. 

Comments

Thanks, Charles! I agree! Corrections, corrections, fear, fear, dip, dip, and wait…wait… pounce! I will wait for your signal and will keep any grumbling to myself. LOL George on 2/28/2025 4:49:38 PM

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